Many of us have cared for parents who have passed on or are currently caring for elderly parents. It is normal to ponder what it would be like if our children or a family member needed to become a caregiver for us. This is not something that anyone likes to contemplate, but it is important to think about and plan for.
None of us have a crystal ball. We don’t know what the future will bring us. What we do know is that good planning makes things go more smoothly and with less anxiety for us and our loved ones. Here are two cases illustrating the benefits of good planning and the risks of no planning.
Katherine, who lived in Florida, had one adult daughter in Chicago and one in Florida. When she was in her early 80’s she fell and broke a hip. A year later she fell and broke her pelvis, femur, and the other hip. The second fall was a more serious situation. In addition she experienced a heart attack while in rehab. Her daughter in Florida lived near the rehab facility and, fortunately, was able to step in with the appropriate powers, both for health care and durable property. Katherine had signed POAs and had provided the paperwork to her daughters when she was in her 70’s.
During her 2nd stay in rehab, Katherine became very depressed and it seemed uncertain if this strong independent woman would recover and be able to live on her own as she wished.
Katherine’s daughters researched various retirement and nursing facilities in the event that she would not be able to go home. Long story short, she did go home and lived independently until the end of her life.
Because Katherine was prepared, after having gone through the same situation with her own mother, she made sure her documents were up-to-date and easy to locate. She also made her own funeral arrangements to alleviate that burden on her children. It was a relatively simple process for her daughters to work with her lawyer and financial advisor in order to close her estate when she died.
Sam was 75 and suffered from chronic emphysema, which required several hospitalizations during his early 70’s. He eventually required skilled nursing home care. Sam had few assets and no planning or POA documents. Without these documents, the doctors and the nursing home personnel made his medical care decisions based on the state, in this case Florida, guidelines, despite the fact that one of his daughters was accessible and lived nearby.
After several episodes, Sam ultimately died from a heart attack in an ambulance on his way to the hospital from the nursing facility. He was estranged from his children, with the exception of one daughter who lived nearby. Because he did not have any estate planning documents and had few assets, the estate was processed as a disposition without administration through probate in Florida in a relatively quick process. Had his estate been larger, it would have required hiring a probate attorney and would have taken a much longer time to settle.
Even though there was minimal property and money, the estranged children reappeared for their share. Eventually, the children agreed to split the remaining assets 3 ways.
With proper documents, Sam may have received better care if his daughter had the appropriate authority through a POA. He may have also wanted to leave her with his remaining assets. Instead, all of his end-of-life decisions were made by the governing laws. Having your care left to the mercy of the state is everyone’s worst nightmare.
We have compiled a few questions to give you a sense of how prepared you are for this stage in life. If you can answer these questions with a yes, you have done an outstanding job of planning! If there are some no’s, it is time to get your plan updated.
We all learn from past experiences, both the good and the painful ones. Learning the hard way is sometimes the best teacher. Unfortunately, in these types of situations, it is your loved ones who will bear the brunt of the consequences of poor planning.
If you have questions, please contact Jenifer for more information about long term care and estate planning.
Jenifer Aronson is the Founder of Mosaic Fi.